Pokerstars Alliance Reacts To Gatto Bill

It hasn't taken long for the powerful coalition of Pokerstars, two Californian tribal groups and three major card rooms to react to AB9, an online poker legalisation bill launched this week by Californian Assemblyman Mike Gatto… and the response is negative.

In a brief statement the coalition of Amaya-Pokerstars, the Morongo Band of Mission Indians, the San Manuel Band of Mission Indians, and California's three largest card clubs, the Commerce, the Hawaiian Gardens and the Bicycle Casino commented Thursday:

"As a coalition, we are committed to working with legislators and our other partners in the gaming community to pass Internet poker legislation in 2015 that establishes a vibrant, competitive marketplace, provides superior consumer protections, and ensures that the state receives a reasonable return.

"We are convinced that the various interests must work together if we are to be successful in establishing a well-regulated environment and the best-in-class Internet poker industry for California.

"Unfortunately, AB 9 is a rehash of previously unsuccessful proposals. Any bill that seeks to establish artificial competitive advantages for some, while denying Californians the best online poker experiences, will only serve to divide the community and will be opposed by our coalition."

The coalition was clearly referring to the bad actor clauses in the Gatto proposal, which could be used to keep Pokerstars out of the market (see previous InfoPowa reports).

Other interested parties, including the Poker Players Alliance, told a variety of industry publications that the Gatto bill is unlikely to find favour in the poker industry due to the bad actor provisions, but also because it is not practical.

That's a reference to the Gatto bill requirement that poker players wishing to open online accounts or even make high or frequent withdrawals in California would have to travel to a designated centre (nominally a casino or card room) to do so in person.

PPA executive director John Pappas was quoted by several publications as opining that this rather clumsy arrangement neutralised the convenience and accessibility of the internet and would discourage recreational players from signing up – and this category of player is essential for a successful business.

He also felt the bill unwisely imposes penalties on players using unauthorised sites; excludes racetracks; and exhibits a fundamental lack of understanding of how to establish synergies between brick-and-mortar casinos and online players.

Other industry observers pointed out that AB9 also opens the way for federal intervention in state affairs because it includes language permitting a transition from an intrastate regulatory regime to an inter-state collaboration, but only if allowed by Congress.

There has also been criticism regarding the motive behind the requirement for players to travel to land gambling venues to open accounts or make frequent or high value withdrawals.

Some analysts suggest that this is a ploy to bring business to land operators at the expense of player convenience… and that there are more efficient and better ways to achieve this without creating extra obstacles for players.

Pappas opined that whilst diehard players may be prepared to journey to a registration or payment centre, he doubted that the majority of recreational players would be prepared to do so, therefore the Gatto proposal could end up excluding a significant number of players from the Californian online poker market.

The PPA director was also critical of any legislative language that for business protectionist reasons seeks to exclude relevant companies from the market, specifically the race tracks and companies like Pokerstars.

He said that the market should be open to all who could satisfy fair regulatory requirements and that more applicants created the potential for a better end product.

Pappas noted that it was still early days to take an official position, but that on the face of it the Gatto bill simply has too many flaws to be effective.

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